Spending grows at weaker pace

Published: Friday, February 01, 2008

WASHINGTON (AP) - Buffeted by soaring fuel prices and tighter credit, consumers increased their spending at the weakest pace in six months. In other signs of trouble, applications for unemployment benefits last week soared by the largest number since Hurricane Katina.

The Commerce Department reported Thursday that consumer spending edged up just 0.2 percent in December - the year's peak shopping season. That was down sharply from a 1 percent gain in November. It was the weakest performance in this area since a similar 0.2 percent rise in June of last year.

Meanwhile, the Labor Department reported that the number of laid off workers filing applications for unemployment benefits increased by 69,000 to 375,000 last week. That was the highest level for jobless claims since the week of Oct. 8, 2005, when the economy was dealing with the disruptions caused by Hurricane Katrina and other Gulf Coast hurricanes.